On 10 July 2026, NITI Aayog convened a critical multi-stakeholder consultation in New Delhi to deliberate on the operational framework of the landmark SHANTI Act 2025. Chaired by Prof. Abhay Karandikar, the meeting brought together top officials from the Ministry of Power, AERB, and industry leaders to discuss regulatory rules, risk mitigation, and domestic capacity building. The SHANTI Act marks a historic policy shift, dismantling India's 60-year state monopoly over nuclear energy to allow regulated private and foreign investment, aiming to achieve a 100 GW nuclear power capacity by 2047.
NITI Aayog organised a high-level stakeholder consultation to deliberate on the operational framework of the SHANTI Act 2025. The discussions focused heavily on drafting specific rules and regulations to facilitate Foreign Direct Investment (FDI) while safeguarding domestic strategic interests. Stakeholders also debated the financial mechanisms required for risk-mitigation, ensuring that operators can secure appropriate insurance for long-term nuclear projects under the new liability regime.
The consultation took place on 10 July 2026 at the Samrasta Auditorium within the Dr. Ambedkar International Centre, New Delhi. This central location frequently serves as a venue for critical policy-shaping dialogues bridging the Indian government and private industry.
1. Rule Formulation: The government drafts statutory compliance mechanisms to safely integrate up to 49% foreign capital into civilian nuclear projects without compromising national security.
2. Risk Mitigation: Financial institutions and the government structure insurance pools to cover the strict ₹3,000 crore operator liability cap, providing certainty to international equipment suppliers.
3. Private Licensing: Indian companies and joint ventures apply to the government and AERB for licenses to build and operate nuclear plants, while the state handles nuclear waste.
4. Ecosystem Scaling: Dedicated capacity-building programmes are launched to strengthen domestic manufacturing and create a highly skilled workforce capable of handling advanced reactor technologies.
This legislative and operational shift is highly relevant to UPSC GS Paper 2 (Governance) and GS Paper 3 (Energy, Infrastructure). Economically, bringing private capital accelerates deployment timelines and reduces the burden on the public exchequer. Environmentally, nuclear power provides a reliable baseload power source crucial for meeting India's 2070 net-zero targets. Technologically, it opens the door to global partnerships for deploying Small Modular Reactors (SMRs) to power data-intensive industries like AI and semiconductor manufacturing.
For over six decades, India's nuclear sector was governed by the Atomic Energy Act of 1962, which mandated an absolute state monopoly driven by strategic military imperatives. In 2010, the Civil Liability for Nuclear Damage Act (CLNDA) was passed, but its stringent supplier liability clauses stalled foreign investment. The SHANTI Act of December 2025 marked a paradigm shift, repealing both previous acts to separate commercial civilian nuclear generation from sensitive strategic operations, thereby unlocking private capital.
Currently, India generates roughly 3% of its electricity from nuclear energy, lagging far behind nations like France (over 65%) and the United States (around 19%). By capping FDI at 49% and aligning its liability laws with international norms, India is shifting from a closed, state-led model similar to Russia or China, toward the Western market-aligned model that leverages private enterprise for clean energy expansion.
India's ambitious target is to scale its nuclear capacity to 100 GW by 2047. The operationalisation of the SHANTI Act rules is expected to trigger a wave of joint ventures between domestic engineering giants and global reactor suppliers. Over the next decade, this framework will likely facilitate the rollout of India's first privately operated Small Modular Reactors (SMRs) and significantly boost the domestic nuclear supply chain.
Core Concept: Exclusive Operator Liability in Nuclear Energy
Q1. Which of the following legislations was repealed by the SHANTI Act of 2025? [Easy]
A) Environment (Protection) Act, 1986
B) Atomic Energy Act, 1962
C) Electricity Act, 2003
D) Energy Conservation Act, 2001
Answer: B
Explanation: The SHANTI Act 2025 repealed both the Atomic Energy Act of 1962 and the Civil Liability for Nuclear Damage Act of 2010.
Q2. Under the SHANTI Act 2025, what is the long-term target for India's nuclear power capacity by the year 2047? [Easy]
A) 50 GW
B) 75 GW
C) 100 GW
D) 150 GW
Answer: C
Explanation: The Act aims to scale India's nuclear power capacity to 100 GW by 2047 to support long-term decarbonisation.
Q3. What is the maximum permissible Foreign Direct Investment (FDI) limit in civilian nuclear power projects as enabled by the SHANTI Act? [Moderate]
A) 26%
B) 49%
C) 74%
D) 100%
Answer: B
Explanation: Non-state and foreign entities may hold up to 49% equity in civilian nuclear power projects to ensure ultimate domestic control.
Q4. Under the tiered liability structure of the SHANTI Act 2025, what is the maximum operator liability cap for large reactors? [Moderate]
A) ₹1,000 crore
B) ₹1,500 crore
C) ₹3,000 crore
D) ₹5,000 crore
Answer: C
Explanation: The SHANTI Act fixes the maximum operator liability for large reactors at ₹3,000 crore (equivalent to 300 million SDRs).
Q5. Which body was granted independent statutory status and enforcement powers under the SHANTI Act 2025? [Moderate]
A) Nuclear Power Corporation of India Limited (NPCIL)
B) Bhabha Atomic Research Centre (BARC)
C) Atomic Energy Regulatory Board (AERB)
D) NITI Aayog
Answer: C
Explanation: The AERB, originally created by an executive order, was given statutory recognition and search-and-seizure powers under the Act.
Q6. Which of the following activities remains strictly reserved for the Central Government under the SHANTI Act 2025? [Tricky]
A) Building a nuclear power plant
B) Designing safety instrumentation
C) Reprocessing of spent nuclear fuel
D) Developing nuclear data analytics
Answer: C
Explanation: While private companies can generate power, back-end activities like spent fuel management and enrichment remain an absolute state monopoly.
Q7. How does the SHANTI Act 2025 alter India's intellectual property regime regarding nuclear technology? [Tricky]
A) It bans all nuclear-related patents permanently
B) It allows patents for peaceful nuclear energy technologies subject to government screening
C) It permits 100% patenting of all nuclear weapons technologies
D) It transfers all existing nuclear patents to the AERB
Answer: B
Explanation: Section 38 of the Act replaces the blanket ban on nuclear patents with a filter that allows patenting of non-strategic, peaceful nuclear innovations.
Q8. The SHANTI Act aligns India's nuclear liability framework with which major international treaty? [Tricky]
A) Non-Proliferation Treaty (NPT)
B) Comprehensive Nuclear-Test-Ban Treaty (CTBT)
C) Convention on Supplementary Compensation (CSC)
D) Paris Agreement on Climate Change
Answer: C
Explanation: By capping operator liability and restricting supplier recourse, the Act aligns India strictly with the global Convention on Supplementary Compensation (CSC) norms.
PYQ 1:
With reference to the governance of nuclear energy in India, the term "Convention on Supplementary Compensation" (CSC) is frequently mentioned in the context of:
A) Eliminating highly enriched uranium from civilian reactors
B) Establishing a global fund for compensating victims of nuclear accidents
C) Sharing dual-use nuclear technology among developing nations
D) Regulating the export of heavy water to non-nuclear weapon states
Answer: B
Explanation: The CSC is an international treaty that establishes a global liability fund to compensate victims in the event of a nuclear accident, which India's SHANTI Act aligns with.
PYQ 2:
Consider the following statements regarding the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025:
1. It permits 100% Foreign Direct Investment (FDI) in the establishment of civilian nuclear power plants.
2. It repeals the Civil Liability for Nuclear Damage Act of 2010.
3. It allows private sector entities to own and manage spent nuclear fuel.
Which of the above statements is/are correct?
A) 1 and 2 only
B) 2 only
C) 2 and 3 only
D) 1, 2 and 3
Answer: B
Explanation: Statement 1 is incorrect as FDI is capped at 49%. Statement 3 is incorrect because spent fuel management remains an exclusive state monopoly. Only statement 2 is correct.
PYQ 3:
Assertion (A): The SHANTI Act 2025 amended the Patents Act to allow intellectual property rights for certain nuclear inventions.
Reason (R): The government aims to encourage private sector innovation and commercial deployment of non-strategic nuclear technologies like Small Modular Reactors (SMRs).
Select the correct answer using the codes given below:
A) Both A and R are true and R is the correct explanation of A
B) Both A and R are true but R is not the correct explanation of A
C) A is true but R is false
D) A is false but R is true
Answer: A
Explanation: The blanket ban on nuclear patents was removed specifically to attract private R&D and commercial innovation in safe, civilian nuclear technologies, making R the correct explanation for A.
Question 1 (150 words): Discuss the significance of the SHANTI Act 2025 in redefining India’s nuclear energy landscape.
The enactment of the SHANTI Act 2025 marks a watershed moment in India’s energy policy by dismantling the state monopoly established under the Atomic Energy Act, 1962. Its primary significance lies in permitting up to 49% FDI and allowing private Indian joint ventures to build and operate civilian nuclear plants.
Economically, this mobilises the massive capital required to scale India’s nuclear capacity from the current 8.78 GW to the ambitious target of 100 GW by 2047. Furthermore, by repealing the contentious CLNDA 2010 and capping operator liability at ₹3,000 crore, the Act provides crucial regulatory certainty to global equipment suppliers who previously shunned the Indian market.
Simultaneously, it safeguards national security by reserving strategic domains—like uranium enrichment and spent fuel reprocessing—exclusively for the state. Moving forward, the swift formulation of rules by NITI Aayog will be essential to actualise this public-private synergy.
Question 2 (250 words): Analyze the shift from a state-monopoly to a market-aligned framework in India’s nuclear sector. How does the SHANTI Act 2025 address the long-standing bottlenecks of nuclear liability and foreign investment?
India’s nuclear governance, anchored in the Atomic Energy Act of 1962, was historically designed around strategic military imperatives, resulting in an absolute state monopoly. While this secured India's strategic autonomy, it severely restricted commercial energy generation, leaving nuclear power stagnant at roughly 3% of the national electricity mix. The SHANTI Act 2025 represents a pragmatic pivot from a security-exclusive framework to one driven by energy security and climate goals.
The most persistent bottleneck in India's nuclear expansion was the Civil Liability for Nuclear Damage Act (CLNDA) of 2010. Its broad supplier liability provisions conflicted with global norms, deterring foreign vendors from supplying critical reactor components. The SHANTI Act resolves this by adopting an exclusive operator liability model capped at ₹3,000 crore for large reactors and strictly limiting the right of recourse against suppliers. This aligns India with the Convention on Supplementary Compensation (CSC), restoring investor confidence.
Furthermore, by capping FDI at 49% in civilian projects, the legislation balances the need for massive foreign capital and advanced tech (like Small Modular Reactors) with the imperative of maintaining domestic control. It also modernises intellectual property laws by permitting patents for peaceful nuclear applications.
However, challenges remain. As NITI Aayog's recent consultations highlighted, building a robust domestic insurance pool and scaling domestic manufacturing capacity are critical hurdles. Ultimately, a transparent regulatory environment under the newly empowered statutory Atomic Energy Regulatory Board (AERB) will be the linchpin in achieving India’s 100 GW nuclear target by 2047.
For Prelims, examiners love testing specific data points introduced by new legislation. Focus strictly on the 49% FDI cap, the ₹3,000 crore liability limit, the 100 GW target by 2047, and the fact that the AERB is now a statutory body. For Mains (GS3), expect analytical questions comparing the restrictive 1962/2010 regimes with the market-friendly 2025 Act, specifically concerning energy security and decarbonisation. In Interviews, board members may test your views on the safety risks of privatising nuclear energy versus the necessity of meeting net-zero targets. High-probability prediction: An MCQ directly comparing the supplier liability clauses of the 2010 CLNDA versus the 2025 SHANTI Act is highly likely in the upcoming UPSC Prelims.